An Act
ENROLLED SENATE
BILL NO. 1390 By: McCortney, Prieto, Jett,
Rogers, Alvord, Hicks , and
Hamilton of the Senate
and
McEntire and Williams of
the House
An Act relating to pharmacy benefits managers;
amending 36 O.S. 2021, Sections 6960, as amended b y
Section 1, Chapter 38, O.S.L. 2022, 6962, as last
amended by Section 1, Chapter 293, O.S.L. 2023, 6965,
as amended by Section 2, Chapter 293, O.S.L. 2023,
Section 3, Chapter 38, O.S.L. 2022, as amended by
Section 3, Chapter 293, O.S.L. 2023, and 6967 (36
O.S. Supp. 2023, Sections 6960, 6962, 6965, and
6966.1), which relate to the Patient ’s Right to
Pharmacy Choice Act; defining terms; modifying
definitions; prohibiting certain contract terms from
restricting document disclosure to certain entities;
modifying certain compliance provisions; conforming
language; construing provisions; providing for rule
promulgation; providing for subpoena of certain
witnesses and records; establishing requirements for
disclosure of protected health information; providing
for censure or license revocation for certain
noncompliance by a pharmacy benefits manager ;
providing for certain fines and fees; providing for
restitution; directing deposit of certain fines,
fees, and penalties; creating the Attorney General ’s
Pharmacy Benefits Manager Enforcement Revolving Fund;
establishing fund source; stating purpose;
establishing provisions relating to public disclosure
of certain report and certain information obtained by
the Attorney General; updating statutory reference;
updating statutory language; repealing 36 O.S. 2021,
Section 6966, which relates to the Patient ’s Right to
ENR. S. B. NO. 1390 Page 2
Pharmacy Choice Commission; providing for
codification; and declaring an emergency.
SUBJECT: Pharmacy benefits manager
BE IT ENACTED BY THE PEOPLE OF THE ST ATE OF OKLAHOMA:
SECTION 1. AMENDATORY 36 O.S. 2021, Section 6960, as
amended by Section 1, Chapter 38, O.S.L. 2022 (36 O.S. Supp. 2023,
Section 6960), is amended to read as follows:
Section 6960. For purposes of the Patient ’s Right to Pharmacy
Choice Act:
1. “Covered entity” means a nonprofit hospital or medical
service organization, insurer, health benefit plan, health
maintenance organization, health program administered by the state
in the capacity of providing health cove rage, or an employer, labor
union, or other group of persons that provides health coverage to
persons in this state. This term does not include a health plan
that provides coverage only for accidental injury, specified
disease, hospital indemnity, disabil ity income, or other limited
benefit health insurance policies and contracts that do not include
prescription drug coverage;
2. “Health insurer” means any corporation, association, benefit
society, exchange, partnership or individual licensed by the
Oklahoma Insurance Code;
2. 3. “Health insurer payor ” means a health insurance company,
health maintenance organization, union, hospital and medical
services organization or any entity providing or administering a
self-funded health benefit plan;
3. 4. “Mail-order pharmacy” means a pharmacy licensed by this
state that primarily dispenses and delivers covered drugs via common
carrier;
4. 5. “Pharmacy benefits manager ” or “PBM” means a person,
business, or other entity that performs pharmacy benefits manage ment
ENR. S. B. NO. 1390 Page 3
and any other person acting for such person under . The term shall
include a person or entity acting on behalf of a PBM in a
contractual or employment relationship in the performance of
pharmacy benefits management for a managed-care managed care
company, nonprofit hospital, medical service organization, insurance
company, third-party payor or a health program administered by a
department of this state;
6. “Pharmacy benefits management ” means a service provided to
covered entities to facilitate the p rovisions of prescription drug
benefits to covered individuals within th is state including, but not
limited to, negotiating pricing and other terms with drug
manufacturers and providers. Pharmacy benefits management may
include any or all of the following services:
a. claims processing, retail network management, and
payment of claims to pharmacies for prescription drugs
dispensed to covered individuals,
b. administration or management of pharmacy discount
cards or programs,
c. clinical formulary develo pment and management
services,
d. rebate contracting and administration,
e. patient compliance, therapeutic intervention, and
generic substitution programs,
f. administration or management of mail -order pharmacy
programs, or
g. disease management progr ams;
5. 7. “Provider” means a pharmacy, as defined in Section 353.1
of Title 59 of the Oklahoma Statutes or an agent or representative
of a pharmacy;
6. 8. “Retail pharmacy network ” means retail pharmacy providers
contracted with a PBM in which the pha rmacy primarily fills and
sells prescriptions via a retail, storefront location;
ENR. S. B. NO. 1390 Page 4
7. 9. “Rural service area” means a five-digit ZIP code in which
the population density is less than one thousand (1,000) individuals
per square mile;
8. 10. “Spread pricing” means a prescription drug pricing model
utilized by a pharmacy benefits manager in which the PBM charges a
health benefit plan a contracted price for prescription drugs that
differs from the amount the PBM directly or indirectly pays the
pharmacy or pharmacist for providing pharmacy services;
9. 11. “Suburban service area ” means a five-digit ZIP code in
which the population density is between one thousand (1,000) and
three thousand (3,000) individuals per square mile; and
10. 12. “Urban service area” means a five-digit ZIP code in
which the population density is greater than three thousand (3,000)
individuals per square mile.
SECTION 2. AMENDATORY 36 O.S. 2021, Section 6962, as
last amended by Section 1, Chapter 293, O.S.L. 2023 (36 O.S. Supp.
2023, Section 6962), is amended to read as follows:
Section 6962. A. The Attorney General shall review and approve
retail pharmacy network access for all pharmacy benefits managers
(PBMs) to ensure compliance with Section 6961 of thi s title.
B. A PBM, or an agent of a PBM, shall not:
1. Cause or knowingly permit the use of advertisement,
promotion, solicitation, representation, proposal or offer that is
untrue, deceptive or misleading;
2. Charge a pharmacist or pharmacy a fee re lated to the
adjudication of a claim including without limitation a fee for:
a. the submission of a claim,
b. enrollment or participation in a retail pharmacy
network, or
ENR. S. B. NO. 1390 Page 5
c. the development or management of claims processing
services or claims payment s ervices related to
participation in a retail pharmacy network;
3. Reimburse a pharmacy or pharmacist in the state an amount
less than the amount that the PBM reimburses a pharmacy owned by or
under common ownership with a PBM for providing the same cover ed
services. The reimbursement amount paid to the pharmacy shall be
equal to the reimbursement amount calculated on a per -unit basis
using the same generic product identifier or generic code number
paid to the PBM-owned or PBM-affiliated pharmacy;
4. Deny a provider the opportunity to participate in any
pharmacy network at preferred participation status if the provider
is willing to accept the terms and conditions that the PBM has
established for other providers as a condition of preferred network
participation status;
5. Deny, limit or terminate a provider ’s contract based on
employment status of any employee who has an active license to
dispense, despite probation status, with the State Board of
Pharmacy;
6. Retroactively deny or reduce reimbursemen t for a covered
service claim after returning a paid claim response as part of the
adjudication of the claim, unless:
a. the original claim was submitted fraudulently, or
b. to correct errors identified in an audit, so long as
the audit was conducted in compliance with Sections
356.2 and 356.3 of Title 59 of the Oklahoma Statutes;
7. Fail to make any payment due to a pharmacy or pharmacist for
covered services properly rendered in the event a PBM terminates a
provider from a pharmacy benefits manager ne twork;
8. Conduct or practice spread pricing, as defined in Section 1
of this act Section 6960 of this title , in this state; or
ENR. S. B. NO. 1390 Page 6
9. Charge a pharmacist or pharmacy a fee related to
participation in a retail pharmacy network including but not limited
to the following:
a. an application fee,
b. an enrollment or participation fee,
c. a credentialing or re -credentialing fee,
d. a change of ownership fee, or
e. a fee for the development or management of claims
processing services or claims payment servic es.
C. The prohibitions under this section shall apply to contracts
between pharmacy benefits managers and providers for participation
in retail pharmacy networks.
1. A PBM contract shall:
a. not restrict, directly or indirectly, any pharmacy
that dispenses a prescription drug from informing, or
penalize such pharmacy for informing, an individual of
any differential between the individual ’s out-of-
pocket cost or coverage with respect to acquisition of
the drug and the amount an individual would pay to
purchase the drug directly, and
b. ensure that any entity that provides pharmacy benefits
management services under a contract with any such
health plan or health insurance coverage does not,
with respect to such plan or coverage, restrict,
directly or indirectly, a pharmacy that dispenses a
prescription drug from informing, or penalize such
pharmacy for informing, a covered individual of any
differential between the individual ’s out-of-pocket
cost under the plan or coverage with respect to
acquisition of the drug and the amount an individual
would pay for acquisition of the drug without using
any health plan or health insurance coverage.
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2. A pharmacy benefits manager ’s contract with a provider shall
not prohibit, restrict or limit disclosure of informat ion and
documents to the Attorney General, law enforcement or state and
federal governmental officials investigating or examining a
complaint or conducting a review of a pharmacy benefits manager ’s
compliance with the requirements under the Patient ’s Right to
Pharmacy Choice Act, Pharmacy Audit Integrity Act, and Section s 357
through 360 of Title 59 of the Oklahoma Statutes .
D. A pharmacy benefits manager shall:
1. Establish and maintain an electronic claim inquiry
processing system using the National C ouncil for Prescription Drug
Programs’ Programs current standards to communicate information to
pharmacies submitting claim inquiries;
2. Fully disclose to insurers, self -funded employers, unions or
other PBM clients the existence of the respective aggre gate
prescription drug discounts, rebates received from drug
manufacturers and pharmacy audit recoupments;
3. Provide the Attorney General, insurers, self -funded employer
plans and unions unrestricted audit rights of and access to the
respective PBM pharmaceutical manufacturer and provider contracts,
plan utilization data, plan pricing data, pharmacy utilization data
and pharmacy pricing data;
4. Maintain, for no less than three (3) years, documentation of
all network development activities including bu t not limited to
contract negotiations and any denials to providers to join networks.
This documentation shall be made available to the Attorney General
upon request; and
5. Report to the Attorney General, on a quarterly basis for
each health insurer pa yor, on the following information:
a. the aggregate amount of rebates received by the PBM,
b. the aggregate amount of rebates distributed to the
appropriate health insurer payor,
ENR. S. B. NO. 1390 Page 8
c. the aggregate amount of rebates passed on to the
enrollees of each heal th insurer payor at the point of
sale that reduced the applicable deductible,
copayment, coinsure or other cost sharing amount of
the enrollee,
d. the individual and aggregate amount paid by the health
insurer payor to the PBM for pharmacy services
itemized by pharmacy, drug product and service
provided, and
e. the individual and aggregate amount a PBM paid a
provider for pharmacy services itemized by pharmacy,
drug product and service provided.
E. Nothing in the Patient ’s Right to Pharmacy Choice Act s hall
prohibit the Attorney General from requesting and obtaining detailed
data, including raw data, in response to the information provided by
a PBM in the quarterly reports required by this section. The
Attorney General may alter the frequency of the rep orts required by
this section at his or her discretion.
F. The Attorney General may promulgate rules to implement the
provisions of the Patient ’s Right to Pharmacy Choice Act , Pharmacy
Audit Integrity Act, and Sections 357 through 360 of Title 59 of the
Oklahoma Statutes.
SECTION 3. AMENDATORY 36 O.S. 2021, Section 6965, as
amended by Section 2, Chapter 293, O.S.L. 2023 (36 O.S. Supp. 2023,
Section 6965), is amended to read as follows:
Section 6965. A. The Attorney General sh all have power and
authority to examine and investigate the affairs of every pharmacy
benefits manager (PBM) engaged in pharmacy benefits management in
this state in order to determine whether such entity is in
compliance with the Patient ’s Right to Pharmacy Choice Act, Pharmacy
Audit Integrity Act, and Section s 357 through 360 of Title 59 of the
Oklahoma Statutes.
B. The Attorney General shall have the power and authority to
subpoena witnesses and records, whether prior to or during an
investigation or prosecution of a complaint, from any relevant
ENR. S. B. NO. 1390 Page 9
entity or persons to ensure compliance with the Patient ’s Right to
Pharmacy Choice Act, Pharmacy Audit Integrity Act, and Sections 357
through 360 of Title 59 of the Oklahoma Statutes .
C. All PBM files and rec ords shall be subject to examination by
the Attorney General or by duly appointed designees. The Attorney
General, authorized employees and examiners shall have access to any
of a PBM’s files and records that may relate to a particular
complaint under investigation or to an inquiry or examination by the
Attorney General.
C. D. Every officer, director, employee or agent of the PBM,
upon receipt of any inquiry from the Attorney General , shall, within
twenty (20) days from the date the inquiry is sent, furn ish the
Attorney General with an adequate response to the inquiry.
D. E. When making an examination under this section, the
Attorney General may retain subject matter experts, attorneys,
appraisers, independent actuaries, independent certified public
accountants or an accounting firm or individual holding a permit to
practice public accounting, certified financial examiners or other
professionals and specialists as examiners, the cost of which shall
be borne by the PBM that is the subject of the examinati on.
F. 1. Protected health information held by a PBM shall be
provided at the request of the Attorney General for the purpose of
conducting investigations into potential violations of state laws
and regulations related to the PBM. Disclosure of protect ed health
information shall be limited to the extent necessary for the
investigation and enforcement of state law.
2. All disclosures of protected health information shall be
made in compliance with all applicable federal and state privacy
laws, including the Health Insurance Portability and Accountability
Act of 1996 (HIPAA), and other relevant laws protecting the privacy
and confidentiality of health information.
3. Any protected health information obtained for an
investigation shall be handled and ma intained per applicable federal
and state privacy laws and regulations, including HIPAA.
ENR. S. B. NO. 1390 Page 10
4. Unauthorized disclosure of protected health information
obtained during an investigation is strictly prohibited and subject
to legal penalties.
G. 1. If the Attorney General, after notice and opportunity
for hearing, finds that any PBM operating within th is state has not
fully cooperated with an investigation or inquiry conducted by the
Attorney General related to compliance with the Patient ’s Right to
Pharmacy Choice Act, Pharmacy Audit Integrity Act, and Sections 357
through 360 of Title 59 of the Oklahoma Statutes, the Attorney
General may instruct the Insurance Commissioner that the PBM be
censured or his or her license be revoked. If the Attorney General
makes such instruction, the Insurance Commissioner shall enforce the
instructed action within thirty (30) days.
2. In addition to or in lieu of any censure, suspension, or
revocation by the Insurance Commissioner, the Attorney General may
levy a civil fine not less than One Hundred Dollars ($100.00) and
not greater than Ten Thousand Dollars ($10,000.00) for each
violation of this subsection and assess any other penalty or remedy
authorized by this act. For purposes of this section, each day a
PBM fails to comply with an investigation or inquiry may be
considered a separate violation.
SECTION 4. AMENDATORY Section 3, Chapter 38, O.S.L.
2022, as amended by Section 3, Chapter 293, O.S.L. 2023 (36 O.S.
Supp. 2023, Section 6966.1), is amended to read as follows:
Section 6966.1. A. The Insurance Commissioner may censure,
suspend, revoke, or refuse to issue or renew a license of or levy a
civil penalty against any person licensed under the insurance laws
of this state for any violation of the Patient’s Right to Pharmacy
Choice Act, Section 6958 et seq. of this title.
B. 1. If the Attorney General finds, after notice and
opportunity for hearing, that a pharmacy benefits manager (PBM)
violated one or more provisions of the Patient ’s Right to Pharmacy
Choice Act, the Pharmacy Audit Integrity Act or the provisions of
Sections 357 through 360 of Title 59 of the Oklahoma Statues
Statutes, the Attorney General may recommend instruct the Insurance
Commissioner that the PBM be censured, or his or her license may be
suspended or revoked and a penalty or remedy authorized by this act
ENR. S. B. NO. 1390 Page 11
may be imposed. If the Attorney General makes such recommendation
instruction, the Insurance Commissioner shall take the recommended
action enforce such action with in thirty (30) days.
2. In addition to or in lieu of any censure, suspension or
revocation of a license by the Insurance Commissioner, a PBM the
Attorney General may be subject to levy a civil or administrative
fine of not less than One Hundred Dollars ( $100.00) and not greater
than Ten Thousand Dollars ($10,000.00) for each violation of the
provisions of the Patient ’s Right to Pharmacy Choice Act, the
Pharmacy Audit Integrity Act or the provisions of Sections 357
through 360 of Title 59 of the Oklahoma Statues, following notice
and an opportunity for a hearing Statutes.
3. The Attorney General may order restitution for economic loss
suffered by pharmacies or patients for violations of the Patient’s
Right to Pharmacy Choice Act, Pharmacy Audit Integrity Act, or the
provisions of Sections 357 through 360 of Title 59 of the Oklahoma
Statutes.
C. Notwithstanding whether the license of a PBM has been
issued, suspended, revoked, surrendered or lapsed by operation of
law, the Attorney General is hereby author ized to enforce the
provisions of the Patient ’s Right to Pharmacy Choice Act and impose
any penalty or remedy authorized under the act against a PBM under
investigation for or charged with a violation of the Patient ’s Right
to Pharmacy Choice Act, the Phar macy Audit Integrity Act, the
provisions of Sections 357 through 360 of Title 59 of the Oklahoma
Statues Statutes or any provision of the insurance laws of this
state.
D. Each day that a PBM conducts business in this state without
a license from the Insu rance Department shall be deemed a violation
of the Patient’s Right to Pharmacy Choice Act.
E. 1. All hearings conducted by the Office of the Attorney
General pursuant to this section shall be public and held in
accordance with the Administrative Proced ures Act.
2. Hearings shall be held at the office Office of the Attorney
General or any other place the Attorney General may deem convenient.
ENR. S. B. NO. 1390 Page 12
3. The Attorney General, upon written request from a PBM
affected by the hearing, shall cause a full stenograp hic record of
the proceedings to be made by a competent court reporter. This
record shall be at the expense of the PBM.
4. The ordinary fees and costs of the hearing examiner
appointed pursuant to Section 319 of this title may be assessed by
the hearing examiner against the respondent unless the respondent is
the prevailing party.
F. Any PBM whose license has been censured, suspended, revoked
or denied renewal or who has had a fine levied against him or her
shall have the right of appeal from the final order of the Attorney
General, pursuant to Section 318 et seq. of Title 75 of the Oklahoma
Statutes.
G. If the Attorney General determines, based upon an
investigation of complaints, that a PBM has engaged in violations of
the provisions of the Patient ’s Right to Pharmacy Choice Act ,
Pharmacy Audit Integrity Act, and Section 357 through 360 of Title
59 of the Oklahoma Statutes with such frequency as to indicate a
general business practice, and that the PBM should be subjected to
closer supervision with r espect to those practices, the Attorney
General may require the PBM to file a report at any periodic
interval the Attorney General deems necessary.
H. 1. The Attorney General shall have the authority to collect
all fines, penalties, restitution, and int erest thereon pursuant to
the provisions of the Patient ’s Right to Pharmacy Choice Act,
Pharmacy Audit Integrity Act, and the provisions of Section s 357
through 360 of Title 59 of the Oklahoma Statutes, or any other
charge, cause of action, judgment, prelitigation settlement, or
other settlement that requires the recovery of money as a result of
violations of the Patient ’s Right to Pharmacy Choice Act. Funds
collected by the Attorney General pursuant to the Patient ’s Right to
Pharmacy Choice Act, Pharmacy Audit Integrity Act, and Sections 357
through 360 of Title 59 of the Oklahoma Statutes shall be deposited
into the Attorney General ’s Pharmacy Benefits Manager Enforcement
Revolving Fund.
2. Costs of investigation, litigation, attorney fees, and other
expenses incurred shall be retained by the Office of the Attorney
ENR. S. B. NO. 1390 Page 13
General. Remaining funds shall be distributed to pharmacists,
patients, or other injured parties as determined by the Attorney
General.
3. The Attorney General shall promulgate rules for th e
distribution of funds pursuant to this subsection.
SECTION 5. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 6966.2 of Title 36, unless there
is created a duplication in numbering, reads as follow s:
There is hereby created in the State Treasury a revolving fund
for the Office of the Attorney General, to be designated the
“Attorney General’s Pharmacy Benefits Manager Enforcement Revolving
Fund”. The fund shall be a continuing fund, not subject to fiscal
year limitations, and shall consist of any monies collected by the
Attorney General and designated to the fund by law, including those
levied for activities related to enforcement of the Patient ’s Right
to Pharmacy Choice Act, the Pharmacy Audit Int egrity Act, and the
provisions of Sections 357 through 360 of Title 59 of the Oklahoma
Statutes. All monies accruing to the credit of the fund are hereby
appropriated and may be budgeted and expended by the Attorney
General for the purposes provided in th is section. Expenditures
from the fund shall be made upon warrants issued by the State
Treasurer against claims filed as prescribed by law with the
Director of the Office of Management and Enterprise Services for
approval and payment.
SECTION 6. AMENDATORY 36 O.S. 2021, Section 6967, is
amended to read as follows:
Section 6967. A. Documents, evidence, materials, records,
reports, complaints or other information in the possession or
control of the Office of the Attorney General or Insurance
Department or the Right to Pharmacy Choice Commission that are is
obtained by, created by or disclosed to the Office of the Attorney
General or Insurance Commissioner , Pharmacy Choice Commission or any
other person in the course of an evaluat ion, examination,
investigation or review made pursuant to the provisions of the
Patient’s Right to Pharmacy Choice Act, the Pharmacy Integrity Audit
Integrity Act or Sections 357 through 360 of Title 59 of the
Oklahoma Statutes, except as provided in subs ection C of this
ENR. S. B. NO. 1390 Page 14
section, shall be confidential by law and privileged, shall not be
subject to open records request, shall not be subject to subpoena
and shall not be subject to discovery or admissible in evidence in
any private civil action if obtained fr om the Attorney General,
Insurance Commissioner, the Pharmacy Choice Commission or any
employees or representatives of the Attorney General or Insurance
Commissioner.
B. Nothing in this section shall prevent the disclosure of a
final order issued against a pharmacy benefits manager by the
Attorney General or Insurance Commissioner or Pharmacy Choice
Commission. Such orders shall be open records.
C. Nothing in this section shall prevent the Attorney General
from making public, in the form of an examinat ion report, any
findings from an examination pursuant to Section 6965 of this title.
It shall be the Attorney General ’s sole discretion to determine
whether it is in the public ’s interest to publish these findings.
Only the final examination report shall be made public. Any
documents, evidence, materials, records, reports, complaints, or
other information in possession or control of the Attorney General
obtained through the examination shall be confidential by law and
privileged, shall not be subject to the Oklahoma Open Records Act,
shall not be subject to subpoena, and shall not be subject to
discovery or admissible evidence in any private civil action if
obtained from the Attorney General.
D. In the course of any hearing made pursuant to the provisio ns
of the Patient’s Right to Pharmacy Choice Act, the Pharmacy
Integrity Audit Integrity Act or Sections 357 through 360 of Title
59 of the Oklahoma Statutes, nothing in this section shall be
construed to prevent the Insurance Commissioner or any employees or
representatives of the Insurance Commissioner from presenting
admissible documents, evidence, materials, records, reports or
complaints to the adjudicating authority.
SECTION 7. REPEALER 36 O.S. 2021, Section 6966, is
hereby repealed.
SECTION 8. It being immediately necessary for the preservation
of the public peace, health or safety, an emergency is hereby
ENR. S. B. NO. 1390 Page 15
declared to exist, by reason whereof this act shall take effect and
be in full force from and after its p assage and approval.
ENR. S. B. NO. 1390 Page 16
Passed the Senate the 29th day of February, 2024.
Presiding Officer of the Senate
Passed the House of Representatives the 1st day of April, 2024.
Presiding Officer of the House
of Representatives
OFFICE OF THE GOVERNOR
Received by the Office of the Governor this _______ _____________
day of _________________ __, 20_______, at _______ o'clock _______ M.
By: _________________________________
Approved by the Governor of the State of Oklahoma this _______ __
day of _____________ ______, 20_______, at _______ o'clock _______ M.
_________________________________
Governor of the State of Oklahoma
OFFICE OF THE SECRETARY OF STATE
Received by the Office of the Secretary of State this _______ ___
day of _________________ _, 20 _______, at _______ o'clock _______ M.
By: _________________________________